California has several new laws affecting real estate and housing coming into effect at various dates in 2024:
Tenants’ Rights
Assembly Bill 12
Landlords in California have been allowed to charge two months’ rent as a security deposit for unfurnished apartments or homes and up to three months’ rent for furnished ones. AB 12 limits security deposits to one month’s rent, regardless of whether the residential property is furnished or unfurnished. It goes into effect on July 1, 2024.
Senate Bill 567
In 2019, California lawmakers passed the Tenant Protection Act which was hailed at the time as one of the strongest laws of its kind in California. It capped rent increases at 10% in most rental properties that were built at least 15 years ago and imposed new eviction protections.
Many tenant activists, however, felt it did not go far enough. SB 567 sought to strengthen the eviction protections in the 2019 law by limiting so-called “reno-evictions” where landlords evict tenants to complete major repairs on the property. It also heightens the penalties for landlords who claim they are taking the property off the rental market only to re-rent the units, among other provisions. SB 567 goes into effect on April 1, 2024.
Assembly Bill 1418
Assembly Bill 1418 deals with “crime-free housing” policies, which often require landlords to evict or otherwise penalize tenants if they have been arrested or had a criminal conviction, or refuse to rent to potential clients due to their prior problems with the law. The “crime-free housing” policies have been shown to impact people of color disproportionately. The new law does not stop landlords from performing background checks, but Assembly Bill 1418 eliminates city policies that require background checks on potential tenants.
ADUs
Senate Bill 976
When accessory dwelling units (ADUs), also known as casitas, granny flats or in-law units, were first legalized, many local governments required they only be built on properties where the owner also lived, a rule that stymied construction. A 2019 Assembly Bill, AB 881 made it illegal to require owners to live on-site. That was set to end in 2025, but AB 976 makes it permanent.
Assembly Bill 1033
Under Senate Bill 1033, local governments can allow property owners to sell an accessory dwelling unit separately from the primary residence, essentially turning the accessory dwelling unit into a condominium.
California ADU Real Estate Disclosures
Housing Production
Senate Bill 4
Effective January 1, 2024, it allows 100% affordable housing developments to be built on land owned by religious institutions and nonprofit colleges or universities. It also exempts those projects from the California Environmental Quality Act and requires construction workers to be paid the prevailing wage.
Senate Bill 423
In 2017, Senate Bill 35 was passed as one of more than a dozen landmark housing bills. The law, which was set to sunset in 2026, requires cities to approve certain housing projects that meet minimum affordable housing requirements if the city has not met its state-mandated housing targets. Senate Bill 423 extends the provisions of Senate Bill 35 through the year 2036.
Senate Bill 684
Senate Bill 684 streamlines the approval process for small, infill apartment buildings with up to 10 units on vacant lots in neighborhoods where apartments are already allowed.
It includes protections against demolishing existing rent-controlled or affordable housing.
Environmental Restrictions
Assembly Bill 1449
Assembly Bill 1449 exempts 100% affordable housing projects from the California Environmental Quality Act, which can delay projects for years. This new environmental law is scheduled to end in January 2033.
Assembly Bill 1307
Assembly Bill 1307 makes clear that noise from students in university housing does not fall under the purview of the California Environmental Quality Act. It resulted from a California appeals court ruling in February 2023 that ruled it could.
Assembly Bill 1633
The San Francisco Board of Supervisors in 2021 failed to approve a five-hundred (500) unit housing project on top of a parking lot claiming the project needed further environmental study. The San Francisco Board of Supervisors did not specify a clear direction for how to bring the project into compliance.
Assembly Bill 1633 clarifies that withholding clearance of a housing development that otherwise meets the requirements of the California Environmental Quality Act is a violation of state housing law.
Learn more about California real estate Errors and Omissions for Companies
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By: Edward McCutchan
Sunderland | McCutchan, LLP
1083 Vine Street Ste. 907
Healdsburg, CA 95448
(707) 433-0377
emccutchan@sunmclaw.com
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